Minn. House Takes On Vikings Proposal In Hearing

Related Tags:

ST. PAUL, Minn. (AP) — Republican leaders in the state House helped retool a Vikings stadium bill that’s headed for its first committee vote Monday, a new signal of support for a proposal that’s struggled to gain momentum at the Capitol.

But Gov. Mark Dayton, a strong stadium supporter, said his own negotiators were left out of the weekend talks that brought together the latest version of a proposal to pay for a stadium with tax revenue from an expansion of gambling. Dayton also criticized a new feature in the bill, the authorization of sports-themed betting “tip boards” he said are illegal under federal law.

Even so, Dayton said he was glad to see the bill moving in the House, where the Commerce Committee was set to hold a Monday night hearing on the proposal for a public-private partnership on a $975 million football stadium in downtown Minneapolis.

The bill is newly backed by the organization that represents Minnesota charities with gambling operations, whose tax proceeds are proposed to cover the state’s $398 million share. The proposal also now includes several backup plans in case the new gambling offerings don’t generate enough tax revenue in a given year to pay off stadium bonds.

Opposition from charities, and concern about the stability of gambling money, had hung up the bill in the House in recent weeks. Rep. Morrie Lanning, the stadium bill’s House author, said key House Republicans and members of Speaker Kurt Zellers’ staff were involved in weekend negotiations to resolve those issues.

Zellers’ previously lukewarm response to the stadium push had been seen to hurt its chances at the Capitol, and had raised concerns among stadium supporters that the issue would not be resolved when legislators adjourn for the year — probably by the end of the month.

The Vikings have been trying for more than a decade to line up partial public funding to replace the Metrodome. The team and its legislative allies have struggled to build support and surmount a series of obstacles, most recently opposition from charitable gambling operators. Under the current proposal, those operators would be authorized to upgrade to electronic versions of their current pull-tab and bingo games as well as add the tip board games.

The state forecasts that would raise about $72 million in new tax revenue per year, with half being used to pay off stadium bonds and the other half going back to charities in the form of tax relief, and to simplify a tax system charitable operators view as overly complex and unfairly burdensome.

“We were able to agree on an approach that works for both of us,” said King Wilson, chief lobbyist for Allied Charities of Minnesota. The bill would change the way charities are taxed, shifting to a tax on net profits rather than gross receipts.

Shifting more money to charities would leave the state with less tax revenue to provide a financial cushion required by issuers of construction bonds. To that end, the latest version of the bill secures four backup funding streams in order to ensure the state treasury is not on the hook if the expanded gambling doesn’t raise as much money as predicted.

The first would be a tax on luxury boxes at the new stadium. That would be followed by a sports-themed lottery game, money from an existing Hennepin County sales tax that helps pay bonds on the Target Field, and a ticket tax at the new stadium. Those provisions are likely to stir backlash: Hennepin County Board Chairman Mike Opat has resisted financial involvement by the county in a new football stadium, and the Vikings have tried to avoid new taxes on stadium-related enterprises.

Opat said Hennepin County leaders were not consulted on the move to tap their sales tax proceeds, and said he’s against it. Lester Bagley, the Vikings’ vice president for stadium development, said the team’s owners negotiated the $427 million share the Vikings have agreed to put up and consider the proposed stadium taxes to be a violation of that agreement.

“Raising the price of our tickets through a tax would impact our relationship with the ticket buyer,” Bagley said. “And it’s basically taking revenue that would otherwise go to the team and put it elsewhere.”

Lanning predicted the House Commerce Committee would approve the stadium bill. He said it would not be possible to put together a bill that completely satisfies everyone with a stake in it.

“We feel this is the best proposal we can put forward at this point in time,” Lanning said.